Turkey to Renew Pipeline Agreement with Iraq

Turkey’s Energy and Natural Resources Minister, Taner Yıldız, has said Turkey will renew the agreement with Iraq for the Kirkuk-Yumurtalık crude oil pipeline on Sept. 19.

The flow of oil through the pipeline was severely affected by the seven-year US occupation of Iraq. The very limited flow has continued to decrease over the last few years.

Yıldız noted that the pipeline has a capacity of 70 million tons per year but that the initial flow of oil will be half that in the first three years. Following the US withdrawal of combat forces from Iraq, Turkey and Iraq are now looking to boost the amount of oil to be transported from Kirkuk in northern Iraq to Yumurtalık in the Ceyhan region of Turkey’s southern province of Adana. Yıldız said a draft has been prepared and that the final agreement is expected to be signed in Baghdad on Sept. 19.

“This is the continuation of a project that will be beneficial for both the Ceyhan and Adana regions as well as for Turkey. At the same time, Iraq needs to export the oil and natural gas it produces, so this is a project that will support Iraq’s path to normalization. In addition to that, it will also be beneficial for increasing the revenue of both Turkey and Iraq. We are renewing the agreement for the Kirkuk-Yumurtalık crude oil pipeline, which has served us for many years. As you know this pipeline has a larger capacity than Baku-Tbilisi-Ceyhan [BTC]. As a result of this agreement we anticipate 70 million tons of oil per year will eventually be carried through the pipeline — although the initial flow of oil will be half this for the next three years. I believe that as Iraq normalizes it will come to a level where it will increase the flow to full capacity and that this will be achieved by its exports via Ceyhan. I believe this will be beneficial for both countries,” Yıldız said.

According to data from state-owned Turkish Pipeline Corporation (BOTAŞ), the Kirkuk-Yumurtalık pipeline carried 36.7 million tons of oil in 2001. The following year, in 2002, Iraq exported another 28 billion tons of oil but the pipeline was closed in 2003 when the US attacked Iraq. Following the war, the exports restarted in 2004 with only 6 million tons but the volume of petroleum flow declined over subsequent years. The volume of annual oil exports from the Kirkuk-Yumurtalık pipeline was recorded as around 2 billion tons for 2005, 2006, and 2007. Last year, the flow of oil reached 26.6 million tons as normalization in Iraq continued to gain momentum.